Author: nivtric

Of Usury, from Brant's Stultifera Navis (the Ship of Fools)

The Problem Of Interest

nivtricLeave a comment

Compounding

Imagine that Jesus’ mother had put a small gold coin weighing 3 grammes in Jesus’ retirement account at 4% interest just after he was born in the year 1 AD. Jesus never retired but he promised to return. Suppose now that the account was kept for this eventuality. Imagine now that the end is near, and that Jesus is about to return. How much gold would there be in the account in 2018?

It is an amount of gold weighing 11 million times the mass of the Earth. The yearly interest would be a gold nugget weighing 440,000 times the mass of the Earth. There is a small problem, a fly in the ointment so to say. It would be impossible to pay out Jesus because there simply isn’t enough gold.

It might seem that the bank had to close long ago because of a lack of gold, but that isn’t true. As long as Jesus doesn’t show up it can remain open, at least if the borrowers are allowed to borrow more to pay for the interest. If the economy grows 4% it may not be such a big deal. The interest can be created out of thin air by making new loans that allow borrowers to pay for the interest. And if Jesus doesn’t claim his gold when he returns and accepts bank credit, everything will be fine.

There is a limited amount of gold while compound interest is infinite. As long as bankers can create money out of thin air to pay for the interest and people accept bank deposits for payment, everything is fine. Problems only arise when people demand real gold. A bank can go bankrupt when depositors want to take out their deposits in gold.

Central banks

Perhaps Jesus’ retirement account isn’t such a big problem after all. Our money isn’t gold but currencies central banks can print. Assume now that Jesus’ mother had put one euro in the account instead. One euro at 4% interest makes 22,000,000,000,000,000,000,000,000,000,000,000 euro after 2017 years. That may seem an intimidating figure, but the European Central Bank can take 22 pieces of paper and print 1,000,000,000,000,000,000,000,000,000,000,000 euro on each of them. And there you are. Something like this happened during the financial crisis of 2008. This is called quantitative easing. You may have heard that word before.

Central banks can print new dollars and euros to cope with a shortfall. In fact, this is what central banks often do. There is always a shortfall because of interest because most money is debt and interest on this debt needs to be paid. To make up for the shortfall, there are two options. First, people can borrow more. Second, central banks can print new currency. Both things can happen at the same time. Central bank decisions about interest rates are also about dealing with the shortfall caused by interest charges.

When central banks lower interest rates, people can borrow more because interest rates are lower. Central banks lower interest rates when people are borrowing less than is needed to cope with the shortfall. If central banks raise interest rates, people can borrow less because interest rates are higher. Central banks raise interest rates when people are borrowing more than is needed to cope with the shortfall and the extra money makes people want to buy more stuff than can be made. And if people don’t borrow at all, this is a crisis, and central banks may print more currency to cope with the shortfall.

Interest on capital versus economic growth

There is a problem central banks can’t fix by printing more currency. Interest is more than just interest on money. Interest is any return on investment. Throughout history returns on investments were mostly higher than the rate of economic growth. Most of these returns have been reinvested so a growing share of total income was for investors. This can’t go on forever because who is going to buy the stuff corporations make in order to keep these investments profitable? A simple example can illuminate that.

interestvers
Interest income (red) versus total income with interest income growing faster than total income

The graph above shows how total income and interest income (in red) develop with an economic growth rate of 2% and an interest rate of 5% when interest income starts out as 10% of total income and all interest income is reinvested. After 25 years the economic pie has grown faster than interest income and wages have risen. At some point interest income starts to rise faster than total income, and wages go down. After 80 years there’s nothing left for wages. This graph explains a lot about what is going on in reality.

In the short run it was possible to prop up business profits and interest rates by letting people go further into debt to buy more stuff. In the long run, the growth rate of capital income cannot exceed the rate of economic growth. Interest rates depend on the returns on capital so this can explain why interest rates went down in recent years. In the past interest rates below zero weren’t possible but from time to time there were economic crises and wars that destroyed a lot of capital. This created new room for growth.

Wealth inequality and income inequality

When interest rates go down, the value of investments tend to rise. If savings yield little this benefits the wealthy as most people have their money in savings while the wealthy own most investments. But it is important to know the cause otherwise you might think that interest rates should rise. The graph above shows that wealth inequality causes interest rates to go lower, hence redistributing income, for example via higher wages or taxes on the wealthy, can bring higher interest rates.

There is a difference between wealth inequality and income inequality. Your labour income and the returns on your investments are your income. If you are rich but make no money on your investments, your wealth doesn’t contribute to your income. In reality wealthy people make better returns on their investments than others because they have better information and can take more risk. Still, the graph shows that income and wealth inequality can’t increase indefinitely, and that returns on investments can’t exceed the reate of economic growth in the long run, hence interest rates need to go lower.

Most people pay more interest than they receive. The interest paid on mortgages and loans is the proverbial tip of the iceberg. Interest is hidden in rents, in taxes because governments pay interest on their debts, and the price of every product and service because investments have to be made to make these products and services. German research has shown that 80% of the people pay more in interest than they receive, while only the top 10% of richest people receive more in interest than they pay. Lower interest rates benefit most people despite some side-effects that work in the opposite direction.

Economic cycles

Humans are herd animals. They buy stuff and even go into debt to buy stuff when others are going into debt to buy stuff too. Suddenly they may realise that they have bought too much or have gone too deeply into debt, and all at the same time. One day they may be borrowing money, queueing up before the shops, and bidding up prices. The next day, they may decide to pay off their debts, leaving the shop owners with unsold inventories they have to get rid of at fire sale prices. So prices may go up when people are in a buying frenzy and may go down when sales dry up.

When there is a buying frenzy business owners are optimistic and do a lot of investments, and often they go into debt to make those investments. But if suddenly customers disappear, they may be stuck with unsold inventory and debts they cannot repay. Businesses may then have to fire people. Those people are then left without income, and cannot repay their debts too, so sales will go down further. If their debts are not repaid, banks could get into trouble. In most cases the economy will recover. In the worst case banks go bankrupt, money disappears, the economy collapses, and an economic depression takes off.

Interest can make things worse. Assume that you have a business and expect to make a return of 8%. You have € 100,000 yourself and you borrow € 200,000 at 6%. You expect to make 8% so borrowing money at 6% seems a good idea. If you only invest your own € 100,000 you can make € 8,000, but if you borrow an additional € 200,000 you can make € 12,000 (8% of € 300,000 minus 6% of € 200,000, which is € 24,000 minus € 12,000). The balance sheet of your business might look like this:

debit
credit
inventory
€ 250,000
loan 6%
€ 200,000
cash, bank deposits
€ 50,000
owner’s equity
€ 100,000
total
€ 300,000
total
€ 300,000

If sales disappoint and you only make a return of 2% on your invested capital of € 300,000, which is € 6,000, you make a loss because you pay € 12,000 in interest charges. You may have to fire workers. Businesses can go bankrupt because they have borrowed too much and have to pay interest, even when they are profitable overall. Sales often disappoint when the economy fares poorly. This means that more businesses face the same difficulties and make losses because of interest payments. They may have to fire workers and these workers lose their income. This can worsen the slump.

Interest, economic depressions and war

Silvio Gesell discovered that interest rates can’t go below a certain minimum because lending would then stop. Money would go on strike as he put it. Why is that? Low yields make investing and lending money unattractive because of the risks involved. Debtors may not repay and banks may go bankrupt. Depositors then prefer to take their money out of the bank and keep it with themselves.

This can cause economic crises and depressions. Silvio Gesell lived around 1900. Interest rates below zero weren’t possible because of the gold standard. Depositors could go to the bank and withdraw their deposits in gold so that they didn’t have to accept negative interest rates. From time to time there were bank runs, economic crises and wars that destroyed a lot of capital. And this created new room for growth.

There may be a relationship between interest, economic depressions and war. In 1910 the amount of capital income (the red circle in the graph) relative to total income (the two circles together) was close to what it was in 2010. This could have led to an economic depression but then came World War I. The war destroyed a lot of capital so that there was new room for capital growth and interest rates could remain positive.

A few decades later the Great Depression arrived. If interest rates could have gone below zero in the 1930s, the Great Depression might not have happened, Adolf Hitler would not have risen to power and World War II would not have occurred. The currency of Wörgl demonstrates that negative interest rates could have ended the depression. After World War II interest rates never came near zero again. Governments and central banks printed more money. This caused inflation, which eroded trust in money.

People feared that inflation would make their money worth less so interest rates rose. In the 1970s the link between money and gold was abandoned because there was a lot more money than there was gold to back it. In the 1980s governments and central banks started policies to bring down inflation and to promote trust in money. As of 1983 interest rates went down gradually as a consequence of a renewed trust in money and central banks. Debt levels rose and interest rates went near zero.

Promoting inflation might not be a good idea. The end result is unpredictable. The best one can hope for is a poor performing economy and a lot of inflation like in the 1970s. But if interest rates rise because lenders lose their trust in money and debts, people may not be able to repay their debts, and the financial system might get into serious trouble. This can cause another great depression or another great war. But if the alternative is negative interest rates, stability and prosperity, then why not opt for that?
eou_31_questions

Featured image: Of Usury, from Brant’s Stultifera Navis (the Ship of Fools). Albrecht Dürer (1494). Public domain.

Wörgl bank note with stamps. Public Domain.

Miracle of Wörgl

nivtric7 Comments

In the middle of the Great Depression, the Austrian town of Wörgl was in deep trouble and prepared to try anything. Of its population of 4,500, 1,500 people were without a job, and 200 families were penniless. Mayor Michael Unterguggenberger had a list of projects he wanted to accomplish, but there was not enough money to carry them out. These projects included paving roads, erecting streetlights, extending water distribution across the whole town, and planting trees along the streets.1 2

Rather than spending the remaining 32,000 Austrian Schilling in the town’s coffers to start these projects, he deposited them in a local savings bank as a guarantee to back the issue of a currency known as stamp scrip. A crucial feature of this money was the holding fee. The Wörgl money required a monthly stamp on the circulating notes to keep them valid, amounting to 1% of the note’s value.1 2 An Argentine businessman named Silvio Gesell had come up with this idea in his book The Natural Economic Order.

Nobody wanted to pay for the monthly stamps, so everyone spent the notes they received. The 32,000 schilling deposit allowed anyone to exchange scrip for 98 per cent of its value in schillings. Hardly anyone did this because the scrip was worth one Austrian schilling after buying a new stamp. But people did not keep more scrip than they needed. Only 5,000 schillings circulated. The stamp fees financed a soup kitchen that fed 220 families.1 2

The municipality carried out the intended works, including new houses, a reservoir, a ski jump and a bridge. The key to this success was the fast circulation of the scrip money within the local economy, fourteen times higher than the schilling. It increased trade and employment. Unemployment in Wörgl dropped 25% while it rose in the rest of Austria. Six neighbouring villages copied the idea successfully. The French Prime Minister, Édouard Daladier, visited the town to witness the ‘miracle of Wörgl’ himself.1 2

In January 1933, the neighbouring city of Kitzbühel copied the idea. In June 1933, Mayor Unterguggenberger addressed a meeting with representatives from 170 Austrian towns and villages. Two hundred Austrian townships were interested in introducing scrip money. At this point, the central bank decided to ban scrip money.1 2

Since then, several communities have issued local scrip currencies. None of them was as successful as the currency of Wörgl. The reasons probably are:

  • There was no economic depression, and the economy could support interest, so introducing scrip money had little effect.
  • If scrip money is not widely accepted, people will exchange it for regular currency if they can’t use it.

In Wörgl, the payment of taxes in arrears generated additional revenues for the town council, which the town council spent on public projects. Once the townspeople had paid their taxes, they would have run out of spending options and might have exchanged their scrip for schillings to avoid paying for the stamps. That never happened because the central bank halted the project.

There are, however, a few issues to consider. The economy of Wörgl did well without issuing debt because the money kept circulating. A negative interest rate induces people to spend the money they have, so no new money has to be borrowed into existence to stimulate the economy. A holding fee makes negative interest rates possible as you do not have to pay it when lending money. For instance, lending out money at an interest rate of -2% is more attractive than paying 12% for the stamps. If we can uncover the conditions for it to work, remove its flaws, and plan for the consequences, we can have a usury-free financial system.

Natural Money

Introducing negative interest rates in the global financial system may have great benefits. The website Naturalmoney.org features an in-depth research of the feasibility and consequences of negative interest rates.

Read More

If you like this post, then you might also like:

Joseph in Egypt

Ancient Egypt had a similar type of money for more than 1,000 years. There is an account in the Bible that may explain how this money came into existence.

Read More

The future of interest rates

In the long run most capital ends up in the hands of the capitalists. Negative interest rates are the logical consequence.

Read More

Latest revision: 6 April 2024.

Featured image: Wörgl bank note with stamps. Public Domain.

1. The Future Of Money. Bernard Lietaer (2002). Cornerstone / Cornerstone Ras.
2. A Strategy for a Convertible Currency. Bernard A. Lietaer, ICIS Forum, Vol. 20, No.3, 1990. [link]

Witbreuksweg dormitory

Meaningful Coincidences

nivtric14 Comments

On 15 July 2011, two television towers in the Netherlands caught fire. One collapsed spectacularly. There had never been a fire in a television tower in the Netherlands. These television towers had been there for over fifty years. And there were only twenty-four of them. A few people speculated about these incidents having a common cause.1 The towers are in different areas, making a common cause unlikely unless there is intent. After all, what is the chance of two aeroplanes crashing into both towers of the World Trade Center in New York on the same day? Only there was no evidence suggesting intent or a common cause. That makes it very mysterious.

Consider this coincidence from Bermuda, which is near the mysterious Bermuda Triangle. In 1975, a 17-year-old boy had a deadly accident while riding his moped. He died exactly a year after his 17-year-old brother died in an accident while riding the same moped in the same intersection and collided with the same taxi with the same driver, carrying the same passenger. Repeating patterns may have contributed to the incident. Perhaps it was a dangerous point where accidents frequently occurred. The passenger may have visited Bermuda once a year and taken a taxi from the airport to the same destination each time.

In 1992, I was bicycling in Groningen, where I lived at the time. On the way, a car door suddenly opened just before me. I could barely avoid a collision. About ten minutes later, on the same trip, it happened again with another car on another road. Never before or after this trip had a car door opened in front of me, even though I had made bicycle trips nearly every day for several decades. It is odd. But what are the odds?

Those incidents might be random events. Many things happen all the time, so bizarre accidents occur by chance. It doesn’t require a Supreme Puppet Master to make them happen. It may be hard to calculate the probability of an event like two television towers catching fire in one country in one day, but it is very low. Only, the number of possible strange incidents is very high.

But how low and how high? That matters tremendously. If there are a million possible events, and the chance of one happening on any given day is one in a million, we should not be surprised when one does. On average, an event like that should happen every day. If it is one in a trillion, and such an event occurs quite frequently, we are on to something, because, on average, it should happen once every million days.

The number of possible strange coincidences is infinite, so it shouldn’t surprise us that simple coincidences, such as a car door opening in front of me twice on a single bicycle trip, happen from time to time. It is, however, odd that it happened twice on one trip and never on any other. Coincidences come in different types. The more intricate a coincidence is, the less likely it is to occur. Indeed, some complicated coincidences are far less likely to occur than two car doors opening on one bicycle trip.

The following falls in the latter category. Once, I entered a do-it-yourself store. There was a couch near the entrance. The price tag of € 389 caught my attention. As a student, I lived in dormitory 389 on the campus. Price tags often end with a nine, so there was nothing suspicious about it, I concluded. Strange things had happened, so I tried to convince myself that it was not unusual. I realised it would be far more curious to find a price tag of € 401, as I had also lived in building 401, and price tags rarely end in a 1.

A few seconds later, I ran into a pile of bags of potting soil. These bags had a conspicuous lettering ’40l’, indicating they contained 40 litres of potting soil. That was close enough to 401 to be intriguing. There were no other types of bags on the spot. Potting soil is available in 10, 20, 25, 40, and 50-litre sizes. Sacks of 40 litres also come with markings such as ’40L’ and ’40 litres’. Hence, the ’40l’ was indeed remarkable.

Two years later, I returned to the same store. These bags of potting soil, marked ’40l’, stood conspicuously stacked near the entrance, reminding me of the previous incident. There was no couch, and I did not see a € 389 price tag there. I contemplated this while fetching the item I planned to buy. Its price tag was €3.89, and I had gone to the store to purchase that one item.

That is far less likely to happen than two car doors opening before me on the same bicycle trip. The events interacted with my thoughts, and the sequel made it even more improbable. The car doors opening could be a coincidence, but the do-it-yourself store incident should boggle the mind, provided one is allowed to think. In one of those dormitories, I met a most peculiar Lady. Since then, a series of noteworthy coincidences have transpired, reminding me of that. This coincidence thus also fits into this scheme, further heightening its peculiarity.

To make the coincidence happen, the bags of potting soil had to be in place, so I would run into them just after thinking of 401. And later, I had to go there to buy an item for € 3.89. And it goes much further than that. The scheme encompasses the item having a price tag of € 3.89, and my having lived in dormitories 389 and 401. That is most peculiar indeed. So much can go wrong. Imagine the bags’ content being 50 litres, the lettering being different, or me visiting another do-it-yourself store or buying another item the second time, and the scheme would fall apart. Perhaps it is a mere coincidence, but it is less likely than two car doors opening in front of me during the same bicycle trip.

On the evening of 11 October 2025, my wife and I watched episode ‘Demon 79’ of the Netflix series Black Mirror. The story played in Great Britain in 1979. It turned out that the murder of two people by a psychotic shoe saleswoman, following orders of a demon disguised as Boney M band member Bobby Farrell, proved insufficient to ward off the apocalypse. The apocalypse proved to be a nuclear war. After watching it, I went to bed. The next morning, I first read the news headlines on the teletext page 101 of the Dutch public television, and found out that two people had died at age 79, actress Diane Keaton and singer Joost Nuissl. So, two people died, thus not enough to ward off nuclear war. Two days later, on 14 October 2025, a NATO exercise named Steadfast Noon began. It included dropping fake atomic bombs above the area where I live. ‘You can sleep peacefully,’ a NATO spokesman added.

Latest revision: 14 October 2025

Featured image: Number 381 dormitory. University Of Twente (2013). [copyright info]

1. Onderzoek: Hoe konden twee zendmasten vandaag in brand vliegen? Algemeen Dagblad (15-07-2011). [link]

Eve in the Garden Of Eden

Mother Goddess Eve

nivtric1 Comment

During archaeological excavations, female figurines have been found. They could depict mother goddesses. The most famous example is the Venus of Willendorf, dating back to around 23,000 BC. In ancient cultures, mother goddesses represented fertility. The ability of women to bear offspring may have been central to Mother Goddess worship. Women give birth, and early humans may not have understood that men were the fathers. They may have thought men had no reproductive use and existed to please the women. Consequently, the Mother Goddess can give birth as a virgin, which is the miracle of the Mother Goddess. One of the best-known Mother Goddesses was Isis.

Venus of Willendorf


Women can be sure that their children are their own, but men can’t. When the fathers of children are unknown, families are often matrilineal, meaning that family lines run through mothers. The goddess worship may have disappeared because men desired to control women and their sexuality. The transition from hunting and gathering to agriculture may have played a crucial role in this development.

Hunter-gatherers were wanderers. They had fewer territorial conflicts. Population density was low, and they had no property, so it was easier to move on if a stronger group invaded a band’s territory.1
That changed with the advent of agriculture. Farmers had to defend their property and families against thieves and invaders. It became a matter of life and death, so warfare became more common and deadly. Giving up territory would mean starvation. Men are willing to protect women and children they consider their own. And they can walk out when they doubt their fatherhood. That gave them a position of power, allowing patriarchy to emerge.

Male dominance is almost universal among humans, with only a few exceptions, so it is something more than merely a cultural phenomenon. Our closest relatives, the chimpanzees, live in groups led by males, while the bonobos live in groups dominated by females. And so it is a natural human inclination.1 As humans are programmable and have diverse cultures, they can overcome their natural inclinations and choose female leaders, or make female leadership the standard in their societies, and invent myths to justify the arrangement, such as stories about the Goddess creating men as companions for women.

As we have no written records, we know little about the lives of hunter-gatherers, their leaders and their family structures. Still, we do know that there must have been enormous cultural diversity, as they lived in small groups with little or no contact with one another. The lifestyle of hunter-gatherers was more favourable to female leadership and matrilineal families than in farming communities, so these were likely more common before the Agricultural Revolution. Peaceful conditions and a belief that men have no reproductive role, thus only exist to please women, could produce female-centred societies.

In her book, When God Was a Woman, historian Merlin Stone claims that goddess worship was the earliest religion in the Near and Middle East. The Creator was a woman before men rewrote history. Stone bases her claim on the discovery of female figurines in archaeological finds. In a 7,000-year-old settlement in Turkey, where archaeologists also found these figurines, families were matrilineal.2

The Garden of Eden features in an ancient Mesopotamian myth, the Epic of Gilgamesh. The garden was near the Tigris and Euphrates rivers. The Jews lived in exile in Babylon when their priests compiled their holy scriptures. The first chapters of Genesis take place in Mesopotamia. Jewish scribes tailored Mesopotamian myths to their needs and incorporated them into the Jewish Bible.

In the Epic of Gilgamesh, the gods created a man from clay, much like in Genesis. Adam means ‘he who came from the ground’. In another creation myth, a goddess gave birth to humanity. Eve means ‘living one’ or ‘life-giver’. The Biblical account might be a merger of these two stories. Eve, having been Adam’s mother, makes more sense than Eve coming from Adam’s rib. She is the Mother of All the Living (Genesis 3:20), and we are the woman’s offspring (seed) (Genesis 3:15). Elsewhere in the Bible, a child is the father’s offspring, which is a noteworthy difference. It implies that we come from women and that men have no reproductive role. That perspective sheds a new light on what Eve said about giving birth to Cain (Genesis 4:1),

Adam made love to his wife Eve, and she became pregnant and gave birth to Cain. She said, ‘With the help of the Lord I have brought forth a man.’

It wasn’t making love to Adam that made Eve give birth, but the Lord’s help. That is noteworthy because we are the woman’s offspring (seed). Perhaps Eve didn’t need Adam to have a child. There is another explanation. Long before the Jews went into exile in Babylon and picked up the story about the Garden of Eden, Asherah was the wife of El. They together were the supreme gods of the Canaanite divine council.3 Perhaps they, together, not only brought forth lesser deities like Yahweh, but also humanity, starting with Cain and Abel, making Asherah the Mother of All the Living.4 Later on, the Jews grew particularly attached to Yahweh, so Yahweh became their supreme deity, replacing El. It was a gradual process that unfolded over centuries, during which Yahweh also adopted some of the features of his main competitor, Baal, a storm deity.

Asherah then became Yahweh’s wife. When the Jews were in exile in Babylon, they may have drawn on local myths to rewrite their creation account. They combined a story in which the first woman gave birth to the first man with one in which God made the first man from clay. In the process of glueing them together, they may have merged the goddess Asherah into the woman Eve. And so, Adam came late for the first man. Asherah then went out of the window, as the Jews turned monotheist. That is speculation, and few have dared to go there, for the evidence to draw such a conclusion is sparse. Yet, it is plausible and explains this peculiarity quite neatly, a quality the truth also possesses.

In the original Mesopotamian tale, Eve gave birth to Adam without prior sexual intercourse. The miracle of the Mother Goddess is the virgin birth. Jesus supposedly was born of a virgin. Since God was supposedly Jesus’ Father, he couldn’t have had a human father. That is the reason we know about. However, it originally alluded to Adam’s birth. Jesus was God’s son because he was Adam reincarnated, the son of Eve, who was God, or so Mary Magdalene made Jesus believe, for the only evidence is that Eve became the Mother of All the Living by taking over Asherah’s role, who was the original Mother Goddess and possibly the mother of humanity. Yet, Asherah was married to El, so only by confounding these two stories might you arrive at such a conclusion.

In scriptural religions, inventing a new story is preferable to contradicting an existing one, as that would imply that the scriptures are corrupt. And you can’t have that, most notably when Paul was around. The virgin birth was a substitute for the facts, as God was to become Jesus’ father, as it reflected God being Jesus’ mother, as God’s name was also Mary. It miraculously solved a serious impediment to unity within the Church, prompting early Christians to agree on this compromise.

The Bible claims that God created a man from the dust of the ground (Genesis 2:7) to work in the garden (Genesis 2:15) and made a woman as a companion for the man (Genesis 2:18). This reflects a merging with another creation myth. Mesopotamia had several creation myths, including one where the gods fashioned a man from clay to do the work. The Bible has two creation stories as well. In Genesis 1, God creates all that is, and then in Genesis 2, God repeats some of that work. Also, there has been some patching here and there to glue these two stories together. In fact, the entire Jewish Bible is a patchwork of stories glued together.

In the original story of Eve and Adam, the man’s purpose was to be the woman’s mate. A reason to think so is that Genesis mentions the woman’s desire for her husband rather than the man’s desire for his wife (Genesis 3:16). If you live in a modern society that has undergone several waves of feminism, you may not realise how odd noting a woman’s desire for a man truly is. The Bible is a product of a patriarchal society. In a patriarchal society, a woman is often a man’s possession, and her desires are of no consequence. The original tale thus had a woman’s perspective. Eve was the leading character. She discussed eating the fruit with the serpent and made Adam eat from it (Genesis 3:1-6). And it was Eve who commented on Cain’s birth, not Adam (Genesis 4:1).

Also noteworthy is that a man left his father and mother to be with his wife (Genesis 2:24). This was how life was in Eden. In patrilineal societies, family groups centre on fathers, while in matrilineal societies, they centre on mothers. Women join their husbands’ families in patrilineal societies. The man leaving his father and mother thus suggests that family groups in Eden were matrilineal. Experts still debate whether hunter-gatherers lived in patrilineal or matrilineal groups. The limited interest among men in childcare suggests that matrilineal groups may have been the norm as long as there were no compelling reasons to do otherwise. These reasons emerged with the advent of agriculture. The title Mother of All the Living may also refer to the Mother Goddess.5 Ashera was the Mother Goddess in Canaan, and one of the deities of the Jews before they became monotheists. Eve also resembles Namma, the primordial mother in the story of Enki and Ninmah.

The story of the Fall is about the curse of knowledge. The Bible tells us it is the knowledge of good and evil, but that is the twist that the Jews gave to the story. You can infer that from what followed. They ate from the tree and realised that they were naked. In other words, they came to know, and there is nothing evil about being naked if that was how life was in Paradise. More knowledge doesn’t make your life better, and God knew.

Knowledge of agriculture enabled the switch from hunting and gathering to agriculture, thereby condemning humankind to a life of toil. The life of hunter-gatherers was more agreeable than the plight of farmers. They had a more varied diet, worked fewer hours, and spent their time doing more exciting things. Additionally, they were less likely to face starvation, disease, and warfare. The Agricultural Revolution did increase the total amount of available food. Yet, this extra food didn’t lead to a better life. It only allowed more people to survive, including elites such as kings and priests, who ate the extra food. The peasants worked harder than the foragers before them and got a poorer life in return.1

The Garden of Eden provided for everything. It was the supposed ideal state of humans, in which they tended and oversaw God’s garden. Eve and Adam were nude (Genesis 2:25), as hunter-gatherers in the jungle today are, so they lived simple lives. They may have been vegetarians, as God only gave them permission to eat plants (Genesis 1:28-30),

God blessed them and said to them, ‘Be fruitful and increase in number; fill the earth and subdue it. Rule over the fish in the sea and the birds in the sky and over every living creature that moves on the ground.’ Then God said, ‘I give you every seed-bearing plant on the face of the whole earth and every tree that has fruit with seed in it. They will be yours for food. And to all the beasts of the earth and all the birds in the sky and all the creatures that move along the ground—everything that has the breath of life in it—I give every green plant for food.’ And it was so.

God once again commanded the man that he was free to eat from any tree in the garden (Genesis 2:16), but did not mention animals. Ruling the animals is not the same as eating them. Eden is the ideal state of Paradise, where we can eat every plant. Meat is a natural part of our diet, so its omission is noteworthy. Yet, it is an idealistic state. God didn’t intend animals to eat meat, either, which obviously is not reality as it is.

As for later verses allowing us to eat animals, it is the same as it is for divorce. Jesus said that it was a concession to our hardness of heart rather than God’s intent. It is where idealism meets a reality check. If a marriage is unhappy, divorce may be the best option. And we may need to eat meat to get the required nutrients. Still, the ruling suggests that eating more meat than necessary, mistreating animals, or killing animals for fun is a sin.

After the Fall, working the land became a life of toil (Genesis 3:17-19), the curse of the Agricultural Revolution. The original tale was also about the downfall of women. Women had to obey their husbands from then on (Genesis 3:16). So, when Jesus said that Moses permitted men to divorce their wives because their hearts were hard, but that it was not this way from the beginning (Matthew 19:18), he could have said the same about slaughtering and eating animals.

In ancient cultures, people venerated snakes for their wisdom so that a snake could provide advice. The snake being evil might be a later-added twist. The tree of knowledge, in the original story, thus may have provided knowledge as such, and that knowledge being about good and evil may also be a later addition. The reason to think so is that after eating from it, Eve and Adam discovered their nakedness rather than found out about good and evil. The theme relates to the sacred tree, which may explain why eating from it was forbidden. Eve’s deed may reflect women’s role in the start of the Agricultural Revolution. Farmers must protect their crops from thieves. Otherwise, they face starvation. It condemned men to a life of warfare. It started with Cain and Abel.

The Abrahamic religions disagree with our Creator being a woman. The Jewish deity Yahweh and the Arabian deity Allah were male, even though many people now think God has no gender. Yahweh and Allah had wives and children before monotheism took over. Allah was at first the supreme deity of Mecca. Later, the owner of the universe appropriated this title. To address the confusion this act generated, the Quran stresses that God has no partner or children. Unlike Christians, Jews and Muslims don’t see God as a Father. Yet Christians are born of God, a most remarkable wording.

The Quran extensively mentions the creation of Adam but says little about the origin of Eve. The Quran doesn’t claim that Eve came from Adam’s rib but that men and women come from one soul (Quran 4:1, 7:189). It relates to Genesis 1:27, in which God created males and females in His image, so that the soul could be God. The Quran further claims that God created Jesus like Adam from dust (Quran 3:59). The Quran also corroborates the virgin birth story of Jesus (Quran 3:47, 66:12). Christians understand the virgin birth story in the context of God being Jesus’ Father, so that he can’t have a human father. However, the Quran makes it clear that God is not Jesus’ Father. And so, being created from dust could refer to birth from a virgin, so Eve could have been Adam’s mother.

The account of the Fall in the Quran differs from that in Genesis in several noteworthy respects. The Quran features no serpent, and Eve didn’t make Adam eat from the tree. The Quran holds both Eve and Adam responsible for the Fall (Quran 7:19-23). Another fragment only blames Adam,

But Satan whispered to him, saying, ‘O Adam! Shall I show you the Tree of Immortality and a kingdom that does not fade away?’ So they both [Eve and Adam]] ate from the tree and then their nakedness was exposed to them, prompting them to cover themselves with leaves from Paradise. So Adam disobeyed his Lord, and so he lost his way.

(Quran 20:120-121)

The historical context of the original story, the curse of the Agricultural Revolution, and the role of women in it have been lost in the Quran. The first Christians believed that Eve was God, the Mother of all the Living, who gave birth to Adam, that Mary Magdalene was Eve, and Jesus was Adam. So Adam and, therefore, Jesus were the Son of God. Humanity descends from Eve, so we are not only God’s children, but also Jesus’ children.

Humans are religious creatures who fight over the myths they believe in, and we will continue to do so until the very end, with increasingly sophisticated means, until humans have terminated themselves. Hence, we need to unite behind a single myth to live in peace. That only happens in fairy-tale worlds where myths can become reality. It may be why Christianity and Islam have been so intolerant towards infidels. Tribal people feel a connection to one another because they believe they share common ancestors. The stories about these common ancestors are myths, such as the tale about Eve and Adam. Eve and Adam came alive again as Mary Magdalene and Jesus. A myth of shared ancestors can turn humanity into a single tribe. And so, Paul may have realised that the good news of Jesus concerns humankind rather than just the Jews.

Latest revision: 28 August 2026

Featured image: Eve in the Garden of Eden. Henri Rousseau (1906-1910). Public Domain. Wikimedia Commons.

Other images: Venus of Willendorf. Don Hitchcock (2008). Wikimedia Commons.

1. A Brief History Of Humankind. Yuval Noah Harari (2014). Harvill Secker.
2. Ancient ‘female-centered’ society thrived 9,000 years ago in a proto-city in Turkey. Kristina Killgrove (2025). Livescience.
3. Daniel O. McClellan, Deity and Divine Agency in the Hebrew Bible: Cognitive Perspectives (PhD diss., University of Exeter, 2020), 327
4. Eve as a goddess/consort of Yahweh? r/AskBibleScholars (2024). [link]
5. Asherah – Wikipedia [link]: Some scholars have found an early link between Asherah and Eve, based upon the coincidence of their common title as “the mother of all living” in Genesis 3:20 through the identification with the Hurrian mother goddess Hebat. Asherah was also given the title Chawat, from which the Aramaic name Hawwah and the biblical name Eve are derived.

Illustration for the first edition of Utopia

Welcome to Utopia

nivtricLeave a comment

Utopian dreams

A few centuries ago, nearly everyone lived in abject poverty. Most people had barely enough to survive. In the Middle Ages, 30% of the children died, often of malnutrition or diseases. And so, Thomas Hobbes wrote in 1651 that man’s life was poor, nasty, brutish, and short. It has been that way since time immemorial. Around 1800, Thomas Malthus concluded that humans live in a permanent state of misery. Once we have more food and resources, more children will survive, so that we will always be on the brink of starvation. At the time, only one billion humans were roaming the Earth, searching for a meal.

Two centuries later, a miracle had occurred, and it was unexpected if you had lived in 1800 or before. Today, more than eight billion people live on this planet, and less than one billion live on the brink of starvation. The life expectancy in the poorest countries exceeds that of the Netherlands in 1750, the wealthiest nation before the Industrial Revolution. At first glance, it looks like Paradise. Available food and resources have increased faster than the population. Capitalism and fossil fuels enabled this growth. We now use more resources than the planet can sustainably provide, so an apocalypse is in the air.

In 1516, Thomas More wrote a novel about a fictional island, Utopia. Life in Utopia was good. The Utopians had a six-hour workday and had enough because everyone took only what they needed. Utopia means ‘nowhere,’ but the name resembles eutopia, which means ‘a good place.’ More may have intended the pun. There is more than enough for all of us. So, why can’t we all work a few hours per day, live peaceful lives and have enough? A well-functioning society requires a set of values and a culture to support it.

Utopian dreams aren’t new. According to the Bible, humankind once lived in the Garden of Eden, where people lived simple lives and were happy with what nature provided. Jesus said, ‘Look at the birds of the air; they do not sow or reap or store away in barns. God feeds them.’ There have since then been utopian dreams of peace and sharing. Most utopian dreamers think of a better world while leaving the hard work to others. In reality, utopian societies are not perfect and are oppressive to those who don’t fit in. Usually, their ideologues define the ideal human as hard-working and public-spirited.

Third ways

There have been several attempts to arrive at a synthesis of capitalism and socialism, often called a third way. The challenge of socialism, the antithesis of capitalism, fuelled a lively debate about economic systems in the second half of the 19th and the first half of the 20th century. Silvio Gesell, who wrote Barataria, was one of the central figures in this debate, as was Henry George in the United States. Since the Cold War, that debate has narrowed down to a struggle between communism and capitalism, or between individual freedom and enforced collectivism. After the collapse of the Soviet Union, the feeling in the West is that capitalism is superior and that there is no alternative.

The Soviets have tried to bring communism into practice. They replaced markets with state planning and repression. Due to the forced collectivisation of farms, millions died of starvation. Millions more ended up in prison labour camps. The end of communism led many people to believe that a better future lay ahead. But many of the economic problems we face today stem from faith in capitalism and the idea that governments can manage its drawbacks. And so, the question remains: is a third way possible? The Chinese have kept innovating and remained determined to make socialism work. It did so by making the Chinese economy more capitalist. However, the state still runs much of it.

The Russians lost faith in the fairy tale of socialism as central planning produced poor outcomes. Still, the Chinese economy has baffled the proponents of the capitalist myth. The Chinese allow the profit motive to exist as long as businesses conform to the Chinese Communist Party’s objectives. State ownership of enterprises further ensures that. The Chinese have demonstrated that you can submit the profit motive to a society’s goals and place large corporations in sovereign wealth funds. But competition still determines the outcome. We are in a rat race that will probably not end well.

The Chinese political economy is more advanced than Western models in that it subordinates the economy to political goals while promoting prosperity for China’s population. In many fields, China has surpassed the West. So if we were to agree on humanity’s goals, political control works better than pure capitalism. Chinese culture contributed to China’s development. Several Asian nations with similar cultures have also successfully modernised their economies. Modernisation is also a cultural shift from reliance on families and communities to markets and states.

The failures of capitalism and socialism come from the fact that both are models of reality, thus simplifications, and that the oversights in both models come with disastrous consequences. We are religious animals who want to believe in fairy tales like capitalism and socialism. The proponents of these systems blame their failures on execution rather than on the systems themselves. To clarify the discussion and address confusion about terminology, it may be helpful to provide definitions of economic systems. Their differences centre around ownership of resources, capital, and labour.


resourcescapitallabour
communismstatestatestate
socialismstatepublicprivate
third way / mixedvariesvariesprivate
capitalismvariesprivateprivate

Under communism, the state owns all there is, including your labour, so you can’t even decide on the job you take. Under socialism, you can choose your occupation, but capital and natural resources are public, thus owned by workers or the state. In mixed economies, ownership of natural resources and capital varies. You may own the ground, but if there is oil underneath, the oil may belong to the state. There may be state-operated corporations, such as railways, alongside private corporations. Under capitalism, everything is private. There may be public services, but there are no public corporations. Few countries give their resources away for free. Governments want a piece of the action.

One crucial oversight is culture. There were substantial differences in living standards in the Soviet Bloc. Czechoslovakia did relatively well. Yugoslavia suffered from high unemployment, but the Slovenian unemployment rate never exceeded 5%, while Macedonia and Kosovo had rates of over 20%. These were extreme differences within a single country and under the same system. Likewise, capitalism also promoted varying results. Latin America remained poor despite having mostly right-wing regimes. Cultures change, and an advantage can turn into a disadvantage. Success breeds complacency, and to stay competitive, you have to regularly ‘reinvent’ yourself.

China has developed its economic model, a state-run socialist market economy, which now outcompetes the West. Its success depends on the Chinese people’s hard work, discipline, and ingenuity, as well as China’s long-standing tradition of modern bureaucratic government and Confucian ethics, which enable the government to work in the public interest and the people to respect authority. Chinese culture thus helped them to achieve this. China’s economic success resembles that of neighbouring countries with similar cultures, such as Japan and South Korea. The Japanese and South Korean economic successes also involved state planning and the state organising industries.

Free economy

There are other ways of organising the economy besides communism and socialism. These are community economics and religious economics, so economies founded on a moral system. Economic thinking centres around the division of tasks between the market and the state. There is little room for moral systems and communities. Religion can make people pursue other goals in life than maximising economic utility, while communities can produce most of the essentials, as they did in the past. Barataria had an economy with private enterprise and home ownership, but without capitalists, bankers, or merchants. The Baratarians were a community sharing a religion.

Silvio Gesell believed in economic self-interest as a natural and healthy motive for satisfying our needs through productive activity. He aimed for free and fair competition with equal opportunities for all. He proposed the end of legal and inherited privileges, so the most talented and productive, rather than the most privileged, would have the highest incomes without distortion by interest and rent charges. Henry George believed that society gives land its value through public services. George thought that a land tax would benefit the overall economy and could replace other taxes.

After Argentina experienced an economic depression in the 1890s, Gesell found that returns sometimes failed to meet investors’ minimum requirements. It caused investors to put their cash in their pockets, disrupting money flows. It regularly caused economic hardship and unemployment. Gesell proposed a holding fee on currency to keep the money in circulation, as low returns are more attractive than paying the surcharge, which amounts to a negative interest rate. Gesell’s economic system was well known in Germany as the free economy. In Wörgl, the holding fee on money proved a successful recipe to revive the economy during an economic depression.

European Union

European economies are mixtures of capitalism and socialism. Many Brits found the union too socialist and bureaucratic, so they left. The European Union tries to regulate capitalism a bit too much to the taste of many Britons. Overall, Western Europeans live a relatively good life. Well-being is hard to measure, but European societies are among the world’s most agreeable, at least if you believe the rankings. And if every country kills innovation with legislation like the bureaucrats of the European Union, we wouldn’t need to fear artificial intelligence, genetic engineering or other new technologies. But this political-economic model will probably not survive the competition for much longer.

Europe has a collectivist tradition with Christian and socialist roots, as well as worker and consumer protection laws. Europeans live longer than Americans, partly because the European Union has banned unhealthy foods that are available in the United States. At the same time, governments run the healthcare systems, so most healthcare is for the public interest rather than private profit. In Europe, it is harder for corporations to pass business-friendly legislation through bribery of politicians. That is also because Europeans have more faith in the common good than Americans do. Like the invisible hand, our imaginary invisible friend, the common good, has a few magical powers of its own.

Immigrants do much of the hard manual labour in Western Europe, often for low wages, so they help many Europeans lead agreeable lives. They frequently live in poor housing. Others may find Western Europeans lazy, as they work 36 hours per week and have five weeks of holidays each year. Europe is losing the competition, or at least that is what the experts think. Still, the lives of people in Western Europe may be the closest to what life should be in Paradise, except that European energy and resource consumption would be unsustainable if everyone lived like that. The demise of the European Dream shows that competition is the reason why we can’t live in Paradise forever.

Nazi Germany

The Nazis produced an economic miracle during the Great Depression. Their success came from deficit spending for rearmament and from restricting trade with the outside world, so government expenditures boosted the German economy without causing trade deficits. It is similar to Keynesian economics. It worked like the miracle of Wörgl, except that the German government accrued a large debt while the council of Wörgl did not.

Factories were idle, and many people were unemployed, so the scheme didn’t lead to high inflation. Price, wage and rent controls also helped keep inflation in check, but they hurt small farmers. The Nazi economy was a mixture of state planning and capitalism. Germany was rearming and preparing for war, so it was also a war economy. Countries organising for war take similar measures to mobilise their industries for warfare.

Yugoslavia

Yugoslavia was socialist rather than communist. It combined state planning with markets and decentralised decision-making or worker self-management. The Yugoslav economy fared better than that of fully communist countries. Yugoslavia was more open, and living standards were higher. Eventually, Yugoslavia couldn’t compete with more capitalist economies. The oil crisis of the 1970s magnified the economic problems. Foreign debt soared. Generous welfare spending further contributed to Yugoslavia’s financial woes. The case of Yugoslavia highlights the issues that plague utopian economies.

The country implemented austerity measures, such as rationing fuel use and limiting imports of foreign-made consumer goods. Yugoslavia had been able to feed its people until then, but from the 1970s onwards, the country became a net importer of farm products. Yugoslav citizens could travel to the West. Emigration helped the economy by reducing unemployment and bringing in foreign currencies as emigrants returned money home to support their families. The Yugoslav economy collapsed in the 1980s.

Openness to foreign competition contributed to the demise of the Yugoslav economy. Yugoslav consumer products were inferior to foreign products. To compete, businesses laid off workers. The Yugoslav economic system might have worked if every country had operated its economy like so. Yugoslav products would have sufficed had there been no better alternatives. In that case, mass unemployment wouldn’t have materialised, and Yugoslavia could have managed, perhaps with less generous welfare. Utopian economics can only work when the economy encompasses the entire world.

China

The stories of Airbus and Boeing demonstrate that state ownership of large businesses can work better than private ownership. Boeing was the industry leader, but ruined itself by focusing on shareholder value. Reducing quality brought short-term cost savings, boosted the stock price, and generated management bonuses. That seemed all fine until Boeing’s aeroplanes began dropping from the sky. The largest holders of Airbus stock are European states, allowing the corporation to focus on its long-term goals. The state-owned aeroplane industry is one of the few areas where Europe is still at the top.

Traditional Soviet-style communism yielded subpar economic results, but the Chinese continued to innovate. The Chinese socialist market economy (SME) has private, public and state-owned enterprises (SOEs). China is not capitalist, as the Chinese Communist Party (CCP) retains control over the country’s direction. It is a command state-market economy like Nazi Germany was. Unlike Nazi Germany, which aimed for maximum self-reliance, the Chinese economy integrated into the global economy. It depends on exports, like those of other Asian Tigers such as Japan and South Korea. China’s advantages include a massive market, which enables it to achieve economies of scale, the world’s longest tradition of rationally administered states, and a culture shared with some other East Asian countries that enabled the Chinese to develop quickly.

The ideological vision behind China’s market reforms was that China was underdeveloped and that a fully developed socialist planned economy would emerge once the market economy fulfilled its historical role, as Marx prophesied. The CCP claims it has incorporated a market economy into the Chinese socialist system. The CCP leadership looks at its project through an ideological lens. Proponents of capitalism might argue that China is more capitalist than the West, given its success. Had China failed, the same people would have blamed it on socialism. Others call it state capitalism, as the SOEs that comprise a large share of the economy operate like private-sector firms and retain their profits rather than returning them to the government. On economic organisation, the West can learn from China.

China eliminated extreme poverty, which declined from over 90% in 1980 to less than 1% today. It also became the world’s leading manufacturing economy and the world’s leading producer of unnecessary items that end up in our landfills. Despite its leadership in renewable energy and electric cars, China has also become the world’s leading polluter and carbon dioxide emitter. China’s status as a manufacturer and exporter distorts the picture. By importing from China, other economies appear less polluting. Those who have visited China long and often enough to have an informed picture agree on the following:

  • China is ahead of the West in several crucial fields. Its economy is more efficient. The West, as it operates now, is losing the competition.
  • Cities are clean, and violent crime levels are low. There is intensive surveillance, which we in the West consider intrusive.
  • There is a lot of corruption. Unlike in many other countries, Chinese corruption promotes economic growth by bribing people to get things done.
  • China is a dictatorship, but citizens have options to criticise and influence the government. If you aren’t a troublemaker, you are relatively free.
  • China represses dissenters and has put millions of people in internment camps to re-educate them and turn them into Chinese citizens.

Chinese corporations align with the Communist Party’s societal goals. There is a profit motive, but profit is secondary. The government can provide support through subsidies. In that sense, the Chinese economy looks like that of the Soviet Union. This model achieves acceptable living standards. At present, China outcompetes the United States and Europe in many fields. If our society’s goals are sustainability and happiness, this economic model can help align corporations with public policies.

State control and ownership of businesses, as in China’s, can be a viable way to pursue political goals such as protecting the environment and reducing poverty. Business objectives, such as profit, can become secondary to political goals, provided that corporations receive support when needed. With state ownership, it becomes feasible to ban products or subsidise others without harming or favouring private entrepreneurs. What China has demonstrated is that a politically steered economy can be competitive and achieve acceptable living standards. And so, we should have confidence that a political economy grounded in moral values can achieve acceptable living standards.

Getting to Denmark

In 1997, my wife and I visited a town in Venezuela. The shops there had armed guards. Shopkeepers believed that they needed these security measures. Not surprisingly, I didn’t feel safe there. If you need guns to protect yourself, something is wrong with society. Perhaps criminals had free rein, and you could not trust the police. Starting a business in Venezuela seemed unwise. I have also been to Denmark. The difference is astounding. Venezuela is an extreme case, and so is Denmark. In the 2024 Corruption Perceptions Index, Denmark ranked first, with the lowest level of corruption in the world. Venezuela was at the bottom. Compared to the rest of the world, Denmark is a Paradise.

Poverty, inequality, and the absence of the rule of law go hand in hand. Without a rule of law, you and your property are unsafe, and building a flourishing society becomes impossible. Some societies are more agreeable than others. Economists understand the rule of law as secure property rights, but it is more important that citizens feel safe and can conduct their affairs in peace. High-quality societies don’t come easy. It is tough to have a capable government, the rule of law, and accountability to the citizens simultaneously. One measure the Danes took to preserve their society was limiting migration, but it would be better if all societies were as agreeable as Denmark’s.

That is possible. Denmark became the way it is because of its unique history. The Danes turned from raping and pillaging Vikings into the peaceful nation it is today. Cultures can change dramatically. Danish history includes the Protestant Reformation. The German sociologist Max Weber argued that the Protestant ethic contributed to the rise of modern capitalism. This ethic includes education, hard work, thrift, and moral uprightness. And that affects attitudes towards graft. The ethic was most present in North-West Europe. Formerly Protestant countries are the least corrupt. But every country can achieve the same. Singapore, Uruguay and Japan are also among the least corrupt countries.

So, what is life in a high-trust society? Everyone is a good citizen. The government is clean. No one misuses state benefits. There is no crime. You feel safe on the streets. You can trust the police. The rules apply to everyone equally. A government can’t create a good society. It merely reflects society. A government can’t enforce laws when its citizens don’t believe in and don’t live by them. Denmark is a cohesive society. People feel connected to each other and share the same values. Becoming a global society like Denmark is an unlikely future for humanity, and getting to Denmark is a utopian dream. Unless, of course, unless a miracle happens. Only religion can move mountains.

Latest revision: 6 December 2025

Featured image: Illustration for the first edition of Utopia by Thomas More.

1. Leviathan. Thomas Hobbes (1651).